FEATURED SLIDESHOW
Who Is The Worst CEO?Mad Money needed new inductees for its
Wall of Shame, so we asked viewers for
nominations.
RECENT POSTS
- Time to Buy Treasurys?
- Lightning Round: Las Vegas Sands, ADC Telecom, Satyam Computer and More
- Lightning Round OT: Knight Capital, Ebix and More
- Is Lear, Back From Bankruptcy, a Buy?
- Sanofi-Aventis Falling Off a Patent Cliff?
- Cramer: Your Thanksgiving Week Game Plan
- Cramer: Next Week Should Define Rest of ‘09
- Mad Money: Mad Mail: Buy RIM or Apple?
- Lightning Round: Cisco Systems, Citigroup, Baidu.com and More
- Lightning Round OT: Martek Biosciences, Valmont Industries and More
Text Size 
Back in August, a Lightning Round caller asked Cramer about a Chinese video game company called Perfect World that runs massive multiplayer online role playing games. Cramer said it was a sell if he’s ever seen one. Now, he thinks he was wrong.
On Monday’s Mad Money, Cramer stood corrected on Perfect World [PWRD
Loading...
()
]. Cramer is often skeptical of Chinese stocks because they don’t have stringent securities regulation, making it hard to find reliable financials. Without solid data behind it, a stock is untouchable no matter how tempting it might look, Cramer often says.
But Perfect World does file financials. It also puts up stellar numbers. In fact, the company just had a huge upside surprise, beating consensus earnings estimates by 81% and sales estimates by 43%. That, along with its earnings visibility, makes Perfect World a near-perfect stock for right now, according to Cramer.
Vivendi’s takeover of Activision [ATVI
Loading...
()
] highlights just how profitable these online role playing games are, too. (Vivendi is the company behind the mother of all role playing games, World of Warcraft.) Basically, players pay a monthly fee to play, which gives the game’s developers recurring cash flow and extremely high operating margins.
None of that means Perfect World isn’t speculative, though. While cheap, Cramer thinks the stock could go lower before it goes higher. But because it only takes the PWRD six months to get a game to market – it takes two years for most other companies – some of the risk is hedged. It also has a catalyst in an upcoming game based on a John Woo film that is the biggest budget Chinese movie in history. Cramer thinks Perfect World should benefit from the marketing there.
The bottom line? PWRD is a buy below $26, Cramer said. It’s volatile, so being patient should pay off in getting this stock at the right price. Cramer thinks it could go to $40 or higher next year.
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website?
Data is a real-time snapshot *Data is delayed at least 15 minutes